Why China – with its massive economy – receives £71m a year in UK foreign aid

MPs have requested a review into why the UK sent £71m in aid to China in a single year, despite the country having an economy five times the size of the UK’s.

Figures on British aid to China were “buried” in the Department for International Development’s (DfID) annual report, which was “quietly put out this week as MPs go on their summer holiday”, the Daily Mail says.

Why does Britain send aid money to China?

China became the world’s second largest economy in 2010, making the idea that Britain – with the world’s fifth largest economy – should send it aid money seem counterintuitive.

However, DfID formally closed its old Chinese aid programme in March 2011, replacing it with a development policy based on “shared global development objectives, global public goods and poverty reduction,” the department says on its website.

In practice, this means that the UK now spends money in China to help develop education, support human rights, combat illegal wildlife trade and promote green energy projects.

DfID says that it has made forging alliances with the “emerging powers” a “foreign and international development policy priority”, and that China, “by far the largest and fastest-growing emerging economy, is at the forefront of this effort”.

Many of the programmes DfID supports in China are also intended to be two-way exchanges, including projects to improve food security in low-income countries, help increase resilience to disasters in Asia and build trade relationships with countries across Africa.

Why do MPs want a review?

Former Conservative leader Iain Duncan Smith yesterday questioned why the UK was sending money to a country which was “breaking every rule in the book”. He described the aid spending as “utter madness” and demanded an urgent review into London’s relationship with Beijing.

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“China is the second-largest economy in the world, and it is winning business all over the world by undercutting firms in the West,” he added.

“This makes it all the more urgent that we have a strategic review of the entirety of our relationship with and our dependency on China, including this sort of nonsense spending on aid.”

Responding to the criticism, the government defended its aid programme by saying that the UK offers “expertise and skills on shared challenges like climate change and health security”.

“Where there is mutual benefit, we invest money which supports UK interests and creates opportunities for UK business,” a spokesperson added.

Will the UK’s aid spend be decreased?

Britain is planning to cut its global aid budget by £2.9bn this year due to the economic damage of the coronavirus crisis, the government announced yesterday.

However, Foreign Secretary Dominic Raab insists the UK still intends to honour its commitment to spend 0.7% of gross national income on international development.

Still, government sources told the Daily Mirror that a “line by line” review of aid projects has been carried out with the “40 most vulnerable countries” prioritised for assistance. Consequently, the “axe would fall” on China, the Daily Mail reports.

Labour MP Sarah Champion, chair of the Commons International Development Committee, criticised the decision to announce cuts just before the summer break.

“If it is with immediate effect, do the projects know or will they find out via the media?” she wrote. “Is there an overarching strategy in place? Clearly there has been no consultation, but to release this news literally as parliament rises so there can be no scrutiny by MPs is poor practice.”

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